The cost of red tape has actually risen for businesses and some Whitehall
departments have not scrapped a single regulation in the last 18 months,
official figures show.

Regulation has cost companies an extra £18.5 million since the beginning of 2011, even though ministers are meant to scrap one rule for every new one they introduce.

Eric Pickles, the Communities and Local Government Secretary, last night said Whitehall must “go further in slashing red tape”, two years after the Coalition first promised to tackle excessive regulation.

Mr Pickles is making a new push to prevent Britain being a “bigger state churning out one regulation after another”, ahead of tomorrow's Enterprise Bill published by Vince Cable’s business department.

The Enterprise Bill is aimed at reducing the cost of employment disputes for companies. However, senior Conservatives are understood to have raised concerns it does not go far enough and that the benefits will be far outweighed by new proposals for flexible working and shared leave between new parents.

Business groups, including the British Chamber of Commerce, are also unhappy that some of the most expensive new European regulations are exempt from the “one-in, one-out” controls.

This has allowed 36 regulations, many relating to Europe, to be brought in by the Department for Business, Innovation and Skills (BIS) in the last six months of 2011.

Just four measures were repealed by the department during that time, including obsolete laws such as the Trading with the Enemy Act dating back to the Second World War.

The Government has claimed £3 billion of savings from cutting red tape, but this is entirely related to a single technical change in how pensions are linked to inflation.

In fact, the burden of regulation has gone up over the last 18 months because the Departments of Health, Environment, Transport and Home Office have all added to overall cost with measures like a ban on tobacco vending machines and changes to alcohol licensing laws.

The Ministry of Justice and the Cabinet Office have not scrapped any regulation at all under the Red Tape challenge, while the health and safety regulator has only got rid of one law with a net benefit of less than £1 per employer.

Mr Pickles last night called for departments to scrap two regulations for every one they create. His department claims to have cut eleven rules for every new one.

“On European regulation far too often past governments have piggy-backed their pet projects under the guise of an EU directive,” Mr Pickles said. "We will introduce a very strict process to weed out EU gold plating."

A spokesman for BIS said the cost of regulation has fallen by £4 million in the first six months of this year.

“Domestic regulation is being stopped in its tracks by our ‘one-in, one-out rule,” he said. “We know European legislation can pose a burden on our businesses and we are working hard to reduce these burdens.”